HMRC suddenly refusing us tax free childcare when nothing had changed

[Maternityleavelady]

Our salaries haven’t changed and out of the blue (after 5 years of tax free childcare), HMRC have said we no longer qualify because they don’t think we will earn the required £846 per month. We have sent them our bank statements and payslips showing historical earnings and confirmed that nothing has changed. They confirmed again that they don’t think we will earn enough. The reply says if we want to appeal we have to go to court!

Is this their attempt to save money? Are they using AI and the algorithm is all wrong? Has anyone had the same issue and successfully had the decision over-turned?

How much are to likely to earn? Has th threshold changed?

If you work that little why do you need childcare...?
Geniune question

What do you mean? The OP doesn’t say anything about how much they work, so I assumed full time?

Can you ask them for a breakdown of their decision and clarification on what the criteria is and why they have decided that you don't qualify?

The lower earning threshold is based on earning minimum wage working 16 hours a week.

This.

I’d ask for the information they have based their decision on if you have already provided clear evidence to show your earnings.

From GOV.UK - https://www.gov.uk/tax-free-childcare/check-if-youre-eligible

You (and your partner, if you have one) must each expect, over the next 3 months, to earn at least:

• £2,539.68 before tax if you’re aged 21 or over (the same as £195.36 per week)
• £2,080 before tax if you’re aged 18 to 20 (the same as £160 per week)
• £1,570.40 before tax if you’re under 18 or an apprentice (the same as £120.80 per week)

This is the National Minimum Wage or Living Wage for 16 hours a week on average.

Are those figures right? £2539.68 x 12 = 30,476.16, before tax.
That's definitely more than minimum wage and more than I earn!

Sounds like she knows the rules since she's already been claiming for a while and nothing has changed for them.

It’s over three months, so it would be multipled by 4, not 12.

Its per 3 months, not monthly.

@PetPeevert I read it that that’s the 3monthly amount - hence around £200pw

Thanks for clarifying

@PetPeevert that’s for 3 months not one month.

as minimum wage has risen op the minimum amount you have to earn has increased. If you were very close to the minimum have you dropped below?

Well over the £846 threshold - one working full time, one working part time.

It’s all very automated - we are not dealing with a human here. When we ask questions we get nothing back. We can appeal (again) or go to court!

We were not close to the threshold so it’s baffling

You both have to be earning over the threshold. Are you PAYE or is one of you self-employed?

Both self employed

Do your tax returns reflect that you are both (separately) earning over the threshold?

Before appealing again - make sure your self employed tax info is up to date on earnings.

Did you get invoices paid early in December, so they are assuming you've both doubled your salaries by having two paydays within 3 weeks?

If you are both self employed how do you have payslips?

Yes

This happened to us recently after my husband had been self employed for about a year. I gave up with trying to contact them and appeal etc and just started the whole thing again and it went through no problem.